Perth to see 10 new industrial developments by end-2027

These projects will yield over 111,00sqm of new stock.

According to a JLL report, five major industrial developments (≥3,000 sqm) completed in Perth in Q3 2024, totalling 43,600 sqm. In addition, ten projects totalling 111,400 sqm are under construction, with expected completion by end-2027.

Seven projects totalling 86,400 sqm are in the plans approved stage, with three projects totalling 21,100 sqm in the plans submitted stage. The majority (65.0%) of these projects are uncommitted.

Here’s more from JLL:

Occupier demand in the Perth market rebounded over Q3 2024, with 100,300 sqm of gross take-up recorded across 11 major occupier moves (≥3,000 sqm). Quarterly tenant activity was significantly above the ten-year quarterly average of 51,200 sqm.

Gross take-up totalled 305,900 sqm over the past 12 months, significantly above the 10-year average of 190,900 sqm. Demand over the same period was led by the Transport, Postal & Warehousing (20.3%), Manufacturing (15.2%) and Construction (10.6%) sectors.

Rental growth recorded across all industrial precincts

Average prime existing net rents increased across all precincts over Q3 2024, increasing 3.6% in the East precinct, and 3.8% in the North and South precincts respectively. On an annual basis, rental growth was strongest in the South precinct at 5.6%.

Prime midpoint yields across all precincts softened 25 basis points (bps) over the quarter. On an annual basis, yields recorded a softening of 50 bps across all three precincts.

Outlook: Rental growth expected to accelerate

Uncommitted supply is still prominent in the Perth market despite still-elevated construction costs, higher labour costs and low project feasibilities. This is further supported by strong occupier demand expected over the short term.

Rental growth is expected to accelerate over the medium term, driven by strong on-going occupier demand and supply scarcity in the Perth industrial and logistics market.